RFID technology has also helped vendors step-up both inventory management and security, in a bid to keep a closer eye on products through the entire supply chain. Learn more about the retail RFID security tags market below.
Reader Feedback The Auto ID center emerged with a different paradigm - much lower cost tags that were primarily "license plate" identifiers, carrying relatively little data that would be tied to databases.
This type of tag is what we now know as the electronic product code EPC. The concept of the "five-cent tag" that would unlock numerous commercial applications was also born at MIT. Though the total vision was certainly broader, clearly the locus of thinking and activity at the Center was the consumer packaged goods to retail value chain.
CPG companies represented by far the largest part of company membership in the Center there were also many RFID technology companies, but few end user companies outside of CPG and retail. All the early trials were in the CPG to retail supply chain, and most of the documents had this chain as their focal point as well.
There was "magic in the air," followed by substantial investment by many large CPG manufacturers, venture capitalists more on that in a moment and technology companies building to this vision, where RFID tagged cases would provide end-to-end, real-time visibility to inventory from manufacturer to store shelf.
But things certainly did not work out as planned. WalMart is doing nothing there, now focused on apparel programs. Even the UK's Tesco stores and Germany's Metro chain, which continued ahead after WalMart had clearly started to bail, have done nothing new for about three years.
Is this not just bizarre? Was this vision in the end just full of mush? Could so many smart people have been so wrong?
Radio frequency identification, or RFID, has the potential to revolutionize the way business is conducted. Consisting of three parts, a chip, a reader, and a database, RFID can automatically identify people and objects by a digit tag and track them through the supply chain. While several studies have analyzed RFID as a facilitator of supply chain management, researchers wanted to consider other available data and see how it might impact other areas of retail operations. “I think for the vast majority [of retailers], this kind of inventory visibility and supply chain management will be critical,” Platt says. The EPC/RFID Retail Supply Chain Data Exchange Study, also dubbed “Project Zipper,” surveyed the effectiveness and business value of item-level RFID tagged items as they travel throughout the supply chain, from a brand owner to a retailer. It examined the flow of information between the brands and retailers over a 1-year period from June.
Or is the value still there, and got waylaid for various reasons, waiting to be reignited? I have thought about this a lot for the past couple of weeks.
I have also talked to a number of people heavily involved at the time - and been turned down by others who didn't want to share their thoughts for whatever reason, largely fear of WalMart wrath, I believe really? The conversations have been interesting - and in total, remind me of the old "different pieces of the elephant" metaphor.
There is connective tissue across all of them, for sure, but each offers a different part of the full story. He noted that even at cents per tag, a level we are just getting to now, that would equal the cost of the secondary packaging itself, "which would be very difficult to justify" in low margin CPG products.
As the reality started to hit relative to the cost impact of the WalMart program versus the benefits, CPG companies started to push back despite such strong earlier enthusiasm. It was called "RFID: A Balanced Perspective," and described the financial and operational challenges CPG companies faced with WalMart's program, calling for more analysis and a slowdown of the rollout.
The work has been sponsored by some 20 CPG companies.
Most were supposed to show up at the Bentonville meeting. Instead only four made it there surprise, surprise and one company rep I know who but won't say here changed gears and wound up taking WalMart's side.
The companies had not prepped Dillman well before hand about what was coming, and Ellis who was there says she was not a happy camper. He also says that then and maybe even today, it turned out that lower margin CPG products cannot well support the cost of RFID tagging in a general sense, versus higher margin apparel and some other non-CPG consumer products.
He also says that some of the retailer mandates may have had a core problem in that they were broad based and did not focus on having all items in a given shelf category being tagged. I had missed that one. Just for the record, I did a quick check on margins, picking two examples.
They took those learnings, and found that the better path to value was to focus on apparel products and item-level tagging. That is what led to rapid progress in RFID technology and performance.
As usual, I am out of space. I heard so much more from my sources than I can share here - we will have more detail in next week's On-Target newsletter. I will summarize here, without necessarily well supporting my conclusions due to lack of space.It's hard to manage what you can't see.
End-to-end visibility helps streamline the supply chain by promptly detecting, reporting, and resolving operational anomalies.
It also allows shippers to track assets and shipment status in real time, with maximum traceability. RFID increases equipment, inventory, and business process visibility. In the retail industry, supply chain management (SCM) is seen as a strategic activity where RFID technology and the EPC network could enhance performance.
Indeed, the link between Internet-based back-end infrastructure and the. Using RFID technology and cloud-based analytics, you can easily track inventory and supervise supply chain procedures to help control shipping status and store inventory levels across the enterprise.
warehouse and gained end-to-end visibility into the supply chain. “The underlying purpose of tagging million garments, each with a UHF RFID tag, was to enhance the throughput of garments through the distribution centers,” says Miguel Maya, associate general. Aspects highlighted include how RFID can benefit retail brand owners, how to move an RFID pilot to production and the five-step plan for RFID deployment success.
(10 pages) Tags: Manufacturing, Retail, Supply Chain, Inventory / Warehouse Management, . At one single point in the supply chain, it might not look like a sound investment, but if you spread out the cost and look at the benefits that RFID provides throughout the supply chain, then retailers .